GEA Group Aktiengesellschaft (GEAGY.PK, GEAGF.PK), a supplier of process technology and components for the food and energy industries, on Monday reported a 43 percent increase in operating profit for the fourth quarter, amid higher sales and increased order intake. The company also announced a hike in dividend. In 2012, the company expects at least a 5 percent rise in sales.
Releasing the preliminary results, the company said earnings before interest and tax, or EBIT, increased 43 percent to 198 million euros from 138.9 million euros. Prior-year figures have been adjusted to allow for revised accounting of pension and lease obligations. Additionally, last year's EBIT is before restructuring expenses of 71.5 million euros.
Revenue increased 27 percent to 1.632 billion euros from 1.290 billion euros. Order intake advanced 20 percent to 1.50 billion euros, marking the highest in the fiscal year, while backlog rose 11 percent to 2.68 billion euros.
According to the company, net debt was reduced by 286 million euros to 387 million euros, owing to positive earnings contributions and strict liquidity management.
For the full year, EBIT grew 33 percent to 475 million euros with prior year EBIT excluding 97.8 million euros in restructuring expenses. Revenue climbed 23 percent to 5.42 billion euros. Order intake jumped 23 percent from last year.
Jürg Oleas, CEO of the company, said, ,"...despite the turbulence on the global financial markets, GEA continued to see dynamic demand and closed the fiscal year on an extremely high note. The volume growth and our profitability in particular clearly exceeded our earlier expectations. Fiscal year 2011 was characterized by the best operating profit and the largest acquisition volume in over 10 years."
The company's board will propose a dividend of 55 cents, up from 40 cents in the previous year. The company has also decided to pay out around 5 million euros to its employees below the top management level as a special allowance for their outstanding performance.
Looking ahead to fiscal 2012, GEA expects that demand in its sales markets will match the level seen in 2011 and expects a rise in order intake by up to 5 percent. Revenue is expected to rise at least 5 percent.
Regarding price quality, GEA expects the market environment to be unchanged from 2011, and sees EBIT margin rising slightly from the previous year.
The stock closed up 1.65 percent on the Xetra in Frankfurt at 25.48 euros.
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